PTC Therapeutics Upgraded to Outperform by RBC

PTC Therapeutics (PTCT) received an investment-rating upgrade Monday to outperform from sector perform from RBC Capital Markets following the biopharmaceutical company’s Saturday release of interim clinical data from the first part of a study of its risdiplam treatment in infants with Type 1 Spinal Muscular Atrophy, a genetic neuromuscular disorder.

RBC also raised its price target on PTC’s shares to $48 per share from $30. The stock closed Friday’s session at $37.55 and jumped 17% to $44.00 in Monday’s recent pre-market trading.

The data released Saturday showed at day 182 of the risdiplam study, more than 90% of the babies achieved a greater than 4-point increase in CHOP-INTEND score — which is designed to measure motor milestone development of patients with SMA Type 1– compared to baseline, PTC said. The company also noted the data were further supported by video footage “demonstrating antigravity movements, the ability to control their head, roll, or sit.”

A second part of the study is ongoing, the company said, noting the SMA program is a collaboration between PTC, Roche (RHHBY) and the SMA Foundation.

In a note to clients, RBC called the data “impressive,” adding it believes the updated clinical data emerging from the study “show compelling efficacy that in our view increase the agent’s ultimate probability of success (increase to 65% from 40%), long-term opportunity across SMA subtypes…and potential for accelerated [Food & Drug Administration] approval.”

While the firm noted “incomplete data and different characteristics make comparisons to SMA agents Spinraza and AVXS-101 difficult, PTC’s economics on the agent from partner Roche are limited, and the stock has run on high expectations,” it added “nonetheless we believe the data should be enough to transform the story and drive [additional] upside for PTCT shares.”

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